Medical Discount Plan In Nevada Skips Insurers

Mounting medical debt and struggles with insurers led Shelley Toreson to drop her health insurance. She now pays discounted rates upfront for her medical needs.

Pauline BartoloneCapital Public Radio

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Originally published on August 14, 2013 4:19 pm

Shelley Toreson, who lives near Reno, Nev., had health insurance for years — but not anymore. Instead, she is part of an unusual Nevada nonprofit that helps connect 12,000 uninsured residents to doctors and hospitals that are willing to accept a lower, negotiated fee for their services.

"The cost just kept going up and the coverage kept getting less," Toreson says, explaining her frustration with her old insurance.

So instead, the 62-year-old signed up with the Access to Healthcare Network, a medical discount plan that helps uninsured residents with low and moderate incomes get care from 2,000 providers around the state. In addition to the provider charges, members also pay $35 a month to the network. That fee buys them ongoing help in finding providers and navigating complicated medical bills.

One in five people in Nevada is uninsured.

Toreson says that now that she has signed on with Access to Healthcare, she knows the cost of a mammogram or other procedure upfront, so the charges for her medical care no longer catch her off guard.

She recently needed gallbladder surgery, for example, and because she knew the cost, was able to borrow about $1,700 from family and friends to pay for it. She had to wait about three weeks to get the surgery, she says. But a network care coordinator helped her work out the details.

"They're so willing to work with you on whatever kind of problem you might have," Toreson says. That wasn't her experience with traditional insurers, she says, where the underlying attitude often seemed to be, "How are we going to not pay this?"

Based in Reno, Access to Healthcare is the brainchild of Sherri Rice, who has worked for 25 years as a consultant to various nonprofit organizations.

Health care and government groups in Reno came to Rice for help in figuring out a way to get care for the uninsured. She says she told them that the key stakeholders — including doctors, hospitals, government officials and financiers, as well as patients — would need to take some responsibility to make the discount plan work.

"I started by asking the hospitals for the [discounted] rates," recalls Rice, who now serves as the network's CEO. "I asked the uninsured to pay cash at the time of service plus a membership fee. I asked the providers to lower their rates. I asked the government to put money in to help sustain the network. I asked everyone to do something."

Rice calls Access to Healthcare a "shared-responsibility model" because the patient and the provider each contribute, and neither is overburdened.

"Our rules are very strict for our members," she says. There's a swift and straightforward penalty for any member who doesn't pay a medical bill, or who is a no-show at a medical appointment more than once without calling to cancel. "I kick them out of this network," Rice says, "and they can't ever come back."

She says about two-thirds of the members are employed but have a job that doesn't include health benefits.

Helen Lidholm, the CEO of St. Mary's Regional Medical Center in Reno, where Toreson had her gallbladder surgery, says her hospital is happy to take network patients. "This is an organization that is taking the poor, many of them disenfranchised, and giving them an opportunity to participate in such an important aspect of life — [their] own health care," Lidholm says.

But, she adds, the model works only because her hospital gets higher payments for other patients from private and public insurers. And even with those payments, Lidholm says her hospital loses money on discounted surgeries like Toreson's.

"It's a good deal," she says. "Could we afford to do that for everyone that walks through the door? No."

The negotiated fees that network members are charged must be paid upfront and can add up — particularly for people with chronic or expensive conditions like cancer. Some network members have to raise money through bake sales or other charity events to pay their bills.

Still, Lidholm says giving care to the uninsured before a health problem escalates into an emergency winds up saving everyone the higher cost of urgent care. And the network's coordinators do a good job, she says, of helping their members stay out of urgent situations.

"Access to Healthcare Network has the lowest emergency room utilization of any payer that I work with," Lidholm says. "And that's remarkable."

Starting next year, two-thirds of the Access to Healthcare members will probably gain traditional insurance coverage because the new federal health law requires them to have it. Some members will be eligible for federal subsidies to help them pay for it, Rice says, and the network is partnering with St. Mary's Health Plans to offer them policies that comply with the Affordable Care Act.

But Rice says the network will continue because there will still be people who fall through the cracks — including immigrants who are not in the country legally, and people who, for whatever reason, decide not to buy health insurance and make too little money to be subject to the federal mandate that requires it.

This story is part of a reporting partnership that includes Capital Public Radio, NPR and Kaiser Health News.

A couple of stories about health care in this part of the program, and we begin in Nevada where more than one in five people lacks health insurance. Even under the Affordable Care Act, many people in the state may not end up getting coverage. But there is another option. Capital Public Radio's Pauline Bartolone has a story about a network that connects people without insurance to health care at reduced rates.

PAULINE BARTOLONE, BYLINE: For 25 years, Sherri Rice's job has been to start up or shape up nonprofit organizations. She says that's why health care and government groups in Reno asked her to figure out how to get care for the uninsured.

SHERRI RICE: And then I sat down one night with two gins and tonics and started writing on a napkin.

BARTOLONE: Rice made a diagram of major community institutions: hospitals, government, bankers. She thought they could all be part of creating a new health care model, a medical discount plan.

RICE: I started by asking the hospitals for the rates. I asked the uninsured to pay cash at the time of service, plus a membership fee. I asked the providers to lower their rates. I asked the government to put money in to help sustain the network. I asked everyone to do something.

BARTOLONE: Seven years later, Rice's vision is now a nonprofit with dozens of staff members and a central office in Reno. It's called Access to Healthcare Network. Twelve-thousand uninsured Nevadans statewide are connected to 2,000 providers, offering almost every medical service at a discounted rate. An additional $35 monthly fee pays for coordinators to help members understand their health care options and what they're responsible for.

Patients pay their doctors at the time of service. Rice calls it a shared responsibility model - everybody contributes something, but no one group is overburdened.

RICE: Our rules are very strict for our members. Two no calls, no shows to any of our providers, any nonpayment - any nonpayment - and I kick them out of this network, and they can't ever come back.

BARTOLONE: Rice says about two-thirds of the members are employed but don't have health benefits at the job. The network gets them into the health care system and leaves insurance companies out of the picture.

Sixty-two-year-old member Shelley Toreson likes it that way. She pages through medical paperwork in her home near Reno. She had health insurance for years.

SHELLEY TORESON: And the cost just kept going up, and the coverage kept getting less.

BARTOLONE: Toreson said she finally had to drop her health insurance. When she had insurance, medical costs always caught her off guard. But not now.

TORESON: Like, right now, I'm going to go have a mammogram. Well, I know the cost upfront, and I know that that's all there's going to be. And, you know, I'm happy with that.

BARTOLONE: Toreson recently had gallbladder surgery. She borrowed about $1,700 from family and friends, and she waited about three weeks to get the surgery. Her care coordinator helped her.

TORESON: They're so willing to work with you on whatever kind of problem you might have. Whereas, I think the health insurance, anytime you call an insurance company, their first thing is like, how are we going to not pay this?

BARTOLONE: Toreson had her surgery at St. Mary's Regional Medical Center in Reno. St. Mary's CEO Helen Lidholm says they're happy to take network patients.

HELENE LIDHOLM: This is an organization that are really taking the poor - and many of them disenfranchised - and giving them an opportunity to participate in such an important aspect of life: your own health care.

BARTOLONE: But Lidholm says this model works only because the hospital gets higher payments from private and public insurance. She says it loses money on discounted surgeries like Toreson's gallbladder procedure.

LIDHOLM: It's a good deal. Could we afford to do that for everybody that walks through the door? No.

BARTOLONE: She says giving care to the uninsured before it reaches an emergency saves everyone the higher cost of urgent care. And Lidholm says the network does a good job at keeping their members out of urgent situations.

LIDHOLM: Access to Health Care Network has the lowest ER utilization of any payer that I work with. And that's remarkable.

BARTOLONE: Starting next year, two-thirds of the Access members will probably gain coverage because of the federal health law and drop their membership. But Rice says there will still be people who fall through the cracks: undocumented people and people who are priced out of the requirement to buy health insurance. For NPR News, I'm Pauline Bartolone. Transcript provided by NPR, Copyright NPR.